Despite impassioned calls from development and housing advocates to push forward a potentially transformative project at Millbrae’s gateway, officials postponed a decision in favor of further examining the massive proposal.

The Millbrae Planning Commission unanimously agreed to push off a recommendation regarding Republic Urban’s interest in building 300 units of housing, roughly 47,000 square feet of retail space, more than 160,000 square feet of office space, a hotel as well as a separate development with 80 affordable units prioritized for military veterans on Bay Area Rapid Transit land.

The decision came late Monday, Oct. 16, after hours of deliberations and comments from dozens of community members who see the project as a key piece to resolving the region’s residential affordability crisis.

While acknowledging the validity of those beliefs, officials opted to bring the issue back for further discussion in early December in an effort to assure it offers the greatest benefit to Millbrae’s community.

“It’s never been a question of whether we want this to happen or not,” said Commissioner Jean Joh. “It’s a matter of whether or not it is done responsibly.”

Answering lingering questions around the design and financing for the affordable housing portion, addressing concerns over the project’s connectivity to the rest of Millbrae and gleaning a better understanding of its impact on the community were primary concerns raised by commissioners.

“It’s not that we don’t want to build affordable housing. We need to look at a good project for our city. We are going to be the ones that are going to be here,” said Commissioner Catherine Quigg.

Commissioners are not the only ones harboring reservations over the project, as developer Republic Urban is also asking officials to consider waiving $3.8 million in fees which it claims is essential to finance construction of the affordable units.

Kelly Erardi, the company’s senior vice president of forward planning, said the fee waiver would allow developers to track down additional funding sources needed to build the below-market units.

He claimed forgiving the fees is a relatively common conciliation offered by cities seeking to build similar projects in acknowledgment of the difficulty associated with building cheaper units.

“What we are asking is kind of the norm, we’d like you to consider it,” he said.

His sentiments were echoed by development partners and San Mateo County officials who said the city’s contribution would trigger tax credits and other financial contributions essential to the affordable development.

Commissioner Anders Fung though pushed back on those claims, pointing to the $350 million overall development price tag hung on the project and questioning the value of the city’s contribution.

“It seems like a drop in the bucket compared to the entire scope of the project,” said Fung, in reference to the nearly $4 million in fee waivers sought.

Erardi countered with suggestions additional value is offered through the fee waiver, by allowing the developer to accept an initial $1.5 million in Measure K money from the county in hopes that amount could grow to $8 million in coming years.

“It’s a layer cake. It’s not just $3.8 million,” said Erardi, referring to the compounding financing mechanism sought for the affordable housing project.

Additional pressure was applied by housing advocates who claimed the affordable units would be an asset for military veterans and others struggling to pay the high rents across the Peninsula.

“I support this project not because it’s good for veterans, but because it’s good for Millbrae,” said Austin Coulter, a veteran and Millbrae native.

Consultant Collette Meunier, who was hired by the city to help usher the project through the approval process, though expressed a commitment by officials to assure the affordable housing project is constructed.

In a brief heated exchange with development supporters, Meunier said officials are negotiating a deal they consider best for Millbrae which guarantees all components of the proposal are brought to fruition.

“Imagine a world where the project is built but the affordable housing isn’t,” said Meunier, echoing the doubts of Millbrae officials who have expressed concerns over the developer’s commitment to constructing the below-market-rate units.

Quigg expressed further reservations over the design of the affordable development, and questioned the logic of isolating the units in a separate building rather than distributing them throughout the rest of the residential project.

“They deserved to be integrated into the community,” said Fung, echoing a similar frustration with the design.

With an understanding that the issues raised would not be resolved during the meeting, commissioners posed their questions which officials and developers committed to answering in the coming weeks.

Erardi indicated many of the connectivity and fiscal concerns identified by officials could be answered through referencing previous studies conducted in earlier phases of the development process.

Republic Urban representatives began advocating for the projects to go before public officials last year following the City Council approving the Millbrae Station Area Specific Plan, which loosened development regulations for the 116-acre site near the intersection of El Camino Real and Millbrae Avenue.

The plan’s approval also paved the way for proposal of the Serra Station project, offering 444 units, more than 290,000 square feet of offices and approximately 13,200 square feet of retail spaces on an opposite side of the train station near El Camino Real.

Both developers and officials have been locked in negotiations aiming toward a development negotiation for roughly one year and the talks for the Republic Urban project hit an impasse recently. An agreement has not been reached for the Serra Station project either, but greater optimism exists a deal can be reached.

Meunier said the officials and Republic Urban representatives would take the feedback offered from officials during the meeting back to the bargaining table and consider it as part of the ongoing development agreement talks.

Fung said he would appreciate more feedback going into the next meeting under the hope it would allow him to better understand the sticking points in negotiations.

“How can we benefit the city a little more so we can consider the proposed reductions in fees?” he said.

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(5) comments

OverTheHill

Remember how this developer spent something like $30,000 in negative campaigning to hurt one candidate and benefit others? Keep it in mind as this thing moves on.

(Edited by staff.)

fazsha

As a Millbrae resident, I say no, no, a thousand times no. The Broadway area can be spruced up if we really want to draw people to Millbrae. Let me remind you, Millbrae has done fine by keeping its population stable. There is no need to provide affordable housing - I don't see Hillsborough next door rushing to build affordable housing. In ten years, they added 4 - yes, FOUR, occupied housing units. See link below.

Let's keep Millbrae the way it is, and only improve existing properties, rather than build new properties. We have a good thing going and we don't want to either call attention to it or mess it up; Millbrae is low profile and we like it that way. Let other cities try to choke every inch of land with development, only to find more problems. Plus, the developer doesn't even want our government to benefit. What's in it for Millbrae? Nothin'!

http://www.bayareacensus.ca.gov/cities/Hillsborough.htm

vincent wei

Hang tough Millbrae...don't let the developers intimidate you and try to bully you into a bad long term deal ...these are TWO massive developments, not just one with affordable,....that will clearly impact the future of the city..

At this particular time, the Peninsula market is prime for any real estate developer and profits are at an all time high...please negotiate these deals without fear of the developers walking away...as there will be a dozen developers right behind them willing to do the deal in a market like this . ... The city actually has the leverage in these cases, and so please use it for the LONG TERM benefit of the City of Millbrae and the surrounding Peninsula area...

Desmo

There is no intimidation going on here; other than maybe some favors being called-in by a city council member. There aren't "dozens" of other developers waiting to pounce on this: only one other has proposed a mixed-use project here and it was turned down. Republic Urban has been working with the city and BART on this project since 2011. The need for housing on the peninsula is great and the need for affordable housing is even greater. This project makes sense and is overdue.

vincent wei

Did you bother to read the article?............ ".......advocating for the PROJECTS (that's with an S) to go before public officials last year following the City Council approving the Millbrae Station Area Specific Plan, which loosened development regulations for the 116-acre site near the intersection of El Camino Real and Millbrae Avenue.

....."The plan’s approval ALSO PAVED THE WAY for proposal of the Serra Station project, offering 444 units, more than 290,000 square feet of offices and approximately 13,200 square feet of retail spaces on an opposite side of the train station near El Camino Real.....".....The vast majority of any of these housing projects on the Peninsula are for market rate housing....like the Windy City project in San Mateo with 1.5 affordable units in total...and it is only one of these Millbrae projects that is offering a decent number of affordable for Vets...and even that will only happen if the City contributes in a major way to the project....

Further there are so many developers trying to get deals on the Peninsula that many of them sell the entitlements as soon as they get them. Happened with Station Green in San Mateo recently and some of the commercial in the same area......
6 years is not a big deal for development projects of this magnitude, often the developers themselves delay approvals until the market conditions improve.....that's also why development agreements are entered into.....

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